Washington – The way in which President Donald Trump sees it, beating China in a commercial war should be easy.
After all, their logic goes, the Chinese sell Americans three times more things than Americans sell them. Therefore, they have more to lose. Inflicts enough pain, such as Combined taxes of 145% He slapped with Chinese imports last month, and will plead mercy.
Trump’s secretary, Scott Besent, has compared Beijing confidence with a card player trapped with a losing hand. “They are playing with a couple of two,” he said.
Someone forgot to tell China. Until now, the Chinese have refused to retire under the pressure of Trump’s mass tariffs. Instead, they have Repliation with triple digit tariffs on your own.
“All thugs are just paper tigers,” said China’s Foreign Ministry in a video last week. “Knealing only invites more intimidation.”
The bets are high between the two largest economies in the world whose trade exceeded $ 660 billion last year. Besent and Trump’s main commercial negotiator, Jamieson Gerr, are Going to Geneva this weekend For initial commercial conversations with senior Chinese officials. Trump suggested Friday that The United States could reduce its tariffs on Chinasaying in a social publication of the truth that “80% of the rate seems correct! to Scott.”
While companies and investors appreciate any flexibility of tensions, the prospects for rapid and significant advance seem faint.
“These are conversations about conversations, and China can evaluate what is on the table, or even just to buy time,” said Craig Singleton, a member of China at the Foundation of Tank Tank based in Washington for the defense of democracies. “There is no shared road map or a clear path for decalcalación.”
But if the two countries eventually agree to scale mass taxes (tariffs, they have slapped in the assets of others, it would relieve world financial markets and companies on both sides of the Pacific Ocean that depend on the United States-China’s trade.
“The companies involved in this trade on both sides can no longer afford to be expected,” said economist John Gong of the University of International Business and Economics in Beijing. In the worst case, China could move away from negotiations if you feel that the American side is not treating China as an equal or not willing to take the first step to unwind, Gong said.
“I think if (Besent) does not enter this negotiation with this type of mentality, this could be very difficult,” he said.
For now, the two countries cannot even agree on who requested conversations. “The meeting is held at the request of the United States,” said the spokesman of the Chinese Ministry of Foreign Affairs on Wednesday, Lin Jian. Trump did not agree. “They should return and study their files,” he said.
What seems clear is that Trump’s favorite economic weapon, import taxes or tariffs, has not proven to be as powerful as he expected.
“For Trump, what happened here is that the rhetoric of his campaign has finally had to face the economic reality,” said Jeff Moon, a commercial official of the Obama Administration who now runs the consultant of China Moon strategies. “The idea that I was going to put China in terms of rates was never going to work.”
Trump sees tariffs an economic tool for any use that can raise money for the treasure of the United States, protect US industries, attract factories to the United States and press other countries to double their will, even in issues such as immigration and drug trafficking.
He used tariffs in his first mandate and has been even more aggressive and unpredictable to impose them in his second. He has slapped a 10% tariffs for almost all countries in the worldexploiting the rules that had governed global trade for decades.
But it is his commercial war with China what he has really put markets and businesses. It began in February when it announced a 10% tax on Chinese imports. In April, Trump increased Taxes on China to an amazing 145%. Beijing increased its tariff on US products to 125%.
Trump’s escalation sent financial markets to fly and left American retailers warning that they could run out of products such as US-China trade implies. American consumers, concerned about the perspective of empty shelves and higher prices, are Lose confidence in the economy.
“This was not very well planned,” said Zongyuan Zoe Liu, a main member in China’s studies in the Foreign Relations Council. “I don’t think I had the intention of tariffs becoming this chaos.”
When Trump hit Chinese imports with tariffs during his first term, he accused Beijing used unfair tactics, including Cyberheft, to give an advantage to his technology firms.
The two countries reached a truce, the so -called phase one agreement, in January 2020; China agreed to buy more US products, and Trump kept even higher rates. But they did not solve the big problems that divided them, including China subsidies of local technology companies.
China was ready for a rematch when Trump returned to the White House. It had worked to reduce its dependence on the mass market in the United States, reducing US participation of its exports to 15% last year from more than 19% in 2018, according to Dexter Roberts of the Atlantic Council.
Beijing is confident that the Chinese people are more arranged than Americans to endure the consequences of a commercial war, including the drop in exports and closed factories. “For China, it is painful, but it is also imperative to resist it, and is prepared to deal with it,” said Sun Yun, director of the China program in the center of Stimson.
In addition to the Chinese resolution for calculating badly, the Trump administration may have underestimated how much depends on the United States in China.
For decades, Americans have come to depend on Chinese factories. They produce 97% of the baby carriages imported from the United States, 96% of their artificial flowers and umbrella, 95% of their fireworks, 93% of their children’s coloration books and 90% of their combs.
“Without us, what do they have to sell?” Chinese toy Cheng Zhengren told Beijing News. “Your shelves would be empty.”
The AFINA shower company reported last month about an experiment that suggests that US consumers have little will to pay more for American manufacturing products. AFINA makes a filtered shower in China and Vietnam that is sold for $ 129. Making the same product in the United States would raise the price to $ 239. When customers on the company’s website received an option among them, 584 chose the cheap Asian; None opted for the most expensive American manufacturing version.
And not only consumers depend on China. The United States factories themselves do too. The National Manufacturers Association calculates 47% of US imports in China in 2023, were “manufacturing supplies”: industrial supplies, car parts and capital equipment in which US manufacturers used to make other products nationwide. Therefore, Trump rates risk costs and reduce the supplies in which the United States factories trust, making them less competitive.
Louise Loo, a China economist from Oxford Economics, a consulting firm, said that China’s capacity to reduce its dependence on the US market in recent years means that “they can probably find substitutes for buyers, much easier than the US side can find suppliers.”
Even so, China will not arise from an unharmed trade war. Citing the impact of the commercial war, the international monetary fund last month reduced the perspective of the Chinese economy this year and next.
“China needs the United States of America,” said White House Press Secretary Karoline Leavitt, in Friday’s news session. “They need our markets. They need our consumer base. And secretary Besent knows that he goes to Switzerland this weekend with the full support, trust and confidence of the president here at home.”
In fact, Moon, who also worked as a diplomat in China, said the rates cut in both directions: “Both depend largely on bilateral trade. They have put themselves in a corner.”
Jens Eskelund, president of the EU Chamber of Commerce in China, expressed relief that US and Chinese officials met.
“So good,” he said, pointing to the Vatican’s conclave who has just chosen a new Pope as inspiration. “Clarlos in a room and then, hopefully, the white smoke will come out.”
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The writers of AP personnel Christopher Rugaber, Seung Min Kim and Josh Boak in Washington, Ken Moritsugu in Beijing and Simina Mistroanu in Taipei contributed to this story.
